Be Sure that Your Risks Aren't Excluded from Your Insurance Policy

Insurance policies often contain exclusions that specify certain situations where coverage may not apply. In a recent case involving a city and its insurer, the issue of coverage arose when a security guard at an event venue allegedly took photos of minor contestants while they were changing clothes. The contestants sued the city that owns the venue. The city sought indemnification from its insurer, but the insurer has filed a declaratory judgment action arguing that the claims did not fall within the policy's coverage.

One of the key exclusions in the policy was for bodily injury, property damage, or personal and advertising injury arising out of abuse or molestation. The insurer argued that the alleged actions of the security guard fell within the scope of this exclusion, as Maryland law defined sexual abuse of a minor to include exploitation, such as taking photographs or videos of a minor in states of undress. Furthermore, the insurer argues, Maryland law considers any action of sexual abuse of a minor to be an intentional act, which is excluded from coverage. 

This case serves as a reminder for youth organizations and other entities that work with minors to thoroughly review their insurance policies. It is crucial to ensure that the policies cover all potential risks, including not only physical injuries but also emotional injuries, defamation, and exploitation.

To navigate the complexities of insurance policies, seek guidance from insurance professionals or consult with an attorney. These professionals can help you review policy language, identify potential gaps in coverage, and provide valuable advice on mitigating risks.

Understanding the exclusions in insurance policies is essential for organizations to protect themselves and those they serve. By being proactive and seeking expert advice, entities can ensure that they have comprehensive coverage that addresses all of the unique risks they face.